AURIZON HOLDINGS LIMITED — Interim / Quarterly Report 2012

Feb 15, 2012

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Dominic D Smith SVP & Company Secretary

QR National Limited

ABN 14 146 335 622

Level 14, 305 Edward Street Brisbane QLD 4000, Australia GPO Box 456 Brisbane QLD 4001, Australia

T +61 7 3235 1976 F +61 7 3235 2188 companysecretary@qrnational.com.au

16 February 2012

ASX Market Announcements Australian Securities Exchange Limited Riverside Centre, Level 5 123 Eagle Street BRISBANE QLD 4000

QR National – Half Year Report Media Release and Analysts Presentation

Please find attached for immediate release to the market a media release and half year results presentation.

The Half Year Results presentation will be delivered to an analyst briefing which will commence at 10:45am (Brisbane Time). This briefing will be webcast and accessible via the Company’s website at www.qrnational.com.au.

Yours faithfully

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Dominic D Smith SVP & Company Secretary

ASX / MEDIA ANNOUNCEMENT 16 February 2012

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- QR National reports lift in half year earnings

Highlights

• Quality result despite continuing flood impacts

• Underlying Earnings Before Interest and Tax (EBIT)[(][1][)] of $251 million

• Statutory Net Profit After Tax (NPAT) of $189 million

• Cost management, efficiency gains and revenue quality continue to offset impact of softer coal tonnages in Queensland

• Full year guidance for underlying EBIT of $578 million unchanged, with coal volumes likely to be at the low end of 200 – 210mt range

• Directors declared an unfranked interim dividend of 3.7 cents per share, which will be paid on 30 April 2012

QR National today announced an 11% increase in underlying EBIT to $251 million for the half-year ended 31 December 2011.

The Company reported underlying Earnings Before Interest, Tax, Depreciation and Amortisation (EBITDA) of $468 million for the period, a 5% increase over the prior corresponding half (HY11: $446 million) notwithstanding the softer coal volumes.

Revenue of $1.77 billion rose by 1% compared to the 2011 half-year ($1.75 billion), and revenue quality continued to improve with above-rail revenue per net tonne kilometre increasing.

Statutory Net Profit After Tax (NPAT) was $189 million versus $278 million for HY11, down 32%. This reduction was largely due to the prior comparable period including a significant tax credit of $281 million which arose on the privatisation. In addition, a provision of $8.8 million was reversed for HY12 following a favourable stamp duty assessment arising out of the privatisation process.

Half year ended 31 December (1H)	2012	2011	Change
QR National Group	$’m	$’m	%
Revenue	1,767	1,748	1
Underlying EBITDA	468	446	5
Underlying EBIT	251	226	11
Statutory NPAT	189	278	(32)
Statutory EPS (CPS)	7.8	12.4	(37)

QR National Managing Director & CEO Lance Hockridge said:

“This is a quality result in challenging circumstances and builds on the momentum achieved by the Company over the past financial year. We continue to improve the efficiency of the business as well as lifting revenue quality,” he said.

“The Company’s focus on execution and business reform has delivered solid first half earnings growth despite a tough macro environment dominated by the lingering impacts of the Queensland floods on mine outputs and haulage volumes.

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“QR National also delivered on major investment growth projects, namely the signing of the Wiggins Island Rail agreement (27mtpa capacity) in September and the commissioning of the Northern Missing Link as part of the Goonyella to Abbot Point Expansion (33mtpa capacity).

“Safety performance continues to improve markedly. The Lost Time Injury Frequency Rate at December 2011 showed a 44% improvement over the 12 months to December 2010.”

Capital investment during the period totalled $609 million including $236 million on the GAP Expansion project, which was opened for rail operations in December 2011, and $148 million in major above-rail growth assets.

With net debt of $919 million at 31 December 2011 and gearing at 11%, the Company has a strong balance sheet and credit ratings heading into the next growth phase for bulk commodities.

The Directors declared an unfranked interim dividend of 3.7 cents per share, which will be paid on 30 April 2012 to shareholders on the register at the record date of 1 March 2012.[(2)]

While Queensland coal tonnages decreased 7% on the prior comparable period, this was balanced by a 34% increase in New South Wales coal volumes, for a net 2% reduction to 98 million tonnes. Revenue in the coal haulage business was up 6% and EBIT up 38%.

Coal railings in Queensland continued to reflect a steady recovery from the 2011 floods, however, other factors such as production issues and industrial disputes at some mines contributed to overall softer tonnages for the period, and some continuing uncertainty for the balance of the financial year.

Growth Projects

QR National advanced its program of major capital projects during the half-year, including the Goonyella to Abbot Point Expansion, the Blackwater Electrification Project and new Hunter Valley Rollingstock.

In addition, QR National signed an agreement with a consortium of eight coal companies in September 2011 to construct the Wiggins Island Rail Project to a new export terminal at Gladstone and commenced the Hay Point 11 million tonne expansion project.

“Our committed expansions are delivering an extra 71 million tonnes of rail capacity over the next three years. This means QR National’s Central Queensland Coal Network will have the capacity to move up to 300 million tonnes of coal per annum by 2015,” Mr Hockridge said.

“In December 2011 we opened the Northern Missing Link, bridging the 69 kilometre gap between the Goonyella and Newlands rail systems. It supports the increase in capacity on the Newlands system of up to 50 million tonnes per year and provides the platform for potential future expansions of 200 million tonnes and more on this corridor.”

Mr Hockridge said the Company continued to evaluate potential rail infrastructure opportunities in Western Australia’s Pilbara and the emerging Galilee coal basin in Queensland.

In January 2012, QR National’s infrastructure proposal for the Galilee Basin was declared a “significant project” by the Queensland Government, allowing community and stakeholder engagement to commence on an Environmental Impact Statement for the project.

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Business Unit Performance

Underlying EBIT	HY12	HY11	Change	Change
	$’m	$’m	$’m	%
Network Services	156	169	(13)	(8)
Coal	139	101	38	38
Freight	29	15	14	97
Other	(73)	(59)	(14)	(24)
Total	251	226	25	11

Network Services

First half revenue of $595 million and underlying EBIT of $156 million were down on the prior corresponding half by 7% and 8% respectively. This reduction in revenue was primarily due to reduced Rollingstock and Infrastructure Services revenue driven by lower rollingstock fleet maintenance requirements and lower external project work primarily for Queensland Rail. The reduction in EBIT was due to lower network volumes and track maintenance being brought forward in advance of volume recovery.

The continued delayed recovery from the 2011 wet season reduced railings across the network to 87 million tonnes, down 7% from 93 million tonnes in HY11. Though tonnages were down, access revenue for the Central Queensland Coal Network remained stable due to the flow through of higher tariffs.

Coal

Despite weaker flood-related volumes, higher revenue rates increased first half revenue by 6% to $950 million (HY11: $895 million) and revenue per NTK (net tonne kilometre) by 9%. Underlying EBIT increased by 38% due to stronger above rail revenue rates, receipt of contract performance payments, reduced labour costs and reduced maintenance costs.

In addition, a detailed review of the fleet including overhaul and maintenance practice has led to extensions in previously conservatively based useful lives of some locomotives which contributed $15 million to the result. This is now aligned to the practice of our peers in the rail sector.

Freight

Revenue of $732 million was up 7% on HY11 ($686 million). Underlying EBIT was $29 million, up from $15 million in the prior corresponding half. Higher volumes in Queensland were partially offset by the delayed grain harvest in Western Australia.

Outlook

Mr Hockridge said QR National remained optimistic about the medium-term outlook for the resources and bulk commodity sectors and anticipates the continuing improvement in Queensland coal tonnages for the remainder of FY12.

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“Our full year guidance for EBIT and tonnages remains unchanged, however, coal tonnages are likely to be at the low end of the 200 – 210mt range and relies on the expected recovery of our customers continuing with minimal disruptions,” he said.

“QR National is well positioned to support our customers’ recovery in the short-term. Over the medium-term, the Company has the execution capability, a strong balance sheet and a pipeline of growth opportunities in our coal and iron ore businesses.

“We’re creating a higher-performing business – a company which uses its suite of assets more efficiently and effectively and also delivers greater value for customers and shareholders.”

For more information:

Investors: Media: Lindsay Woodland Mark Hairsine +61 437 737 457 +61 418 877 574

Footnotes:

• 1 The statutory results included in the half-year financial report are prepared in accordance with IFRS. The underlying results remove the impact of significant items from the statutory results.

Income statement

To provide clarity into the underlying performance of the Company, we present underlying results which exclude any significant items. A reconciliation of underlying EBIT to statutory EBIT is set out below. Underlying EBIT is a measure used internally and in our Investor presentations.

EBIT	HY12	HY11
	$’m	$’m
Statutory EBIT	260	131
Significant items:
Employee benefits	-	57
Restructure costs	(9)	38
Underlying EBIT	251	226

• 2 The conduit foreign income component of the dividend is nil.

4

INTERIM RESULTS 2012

Lance Hockridge – MD & CEO Deborah O’Toole – EVP & CFO 16 February 2012

IMPORTANT NOTICE

Reliance on third party information

This Presentation was prepared by QR National Limited (ACN 146 335 622) (“ QR National ”). This Presentation may contain information that has been derived from publicly available sources that have not been independently verified. No representation or warranty is made as to the accuracy, completeness or reliability of the information.

Presentation is a summary only

This Presentation contains information in a summary form only and does not purport to be complete. It should be read in conjunction with QR National’s 2012 halfyearly financial report. Any information or opinions expressed in this Presentation are subject to change without notice and QR National is not under any obligation to update or keep current the information contained within this Presentation.

Not investment advice

This Presentation is not intended to be, and should not be considered to be, the giving of investment advice by QR National or any of its related bodies corporate, directors, officers, employees, agents, contractors or advisers. The information provided in this Presentation has been prepared without taking into account the recipient’s investment objectives, financial circumstances or particular needs. Each party to whom this Presentation is made available must make its own independent assessment of QR National after making such investigations and taking such advice as may be deemed necessary. The recipient should consult with its own financial, taxation, accounting, legal or other advisers before making any investment decision.

No offer of securities

Nothing in this Presentation should be construed as a recommendation of or an offer to sell or a solicitation of an offer to buy or sell securities in QR National in any jurisdiction (including in the United States). Securities may not be offered or sold in the United States or to, or for the account or benefit of, US persons (as that term is defined in Regulation S under the US Securities Act of 1933 (“Securities Act”)) unless they are registered under the Securities Act or exempt from registration.

Forward looking statements

This Presentation may include forward looking statements. Although QR National believes the expectations expressed in such forward looking statements are based on reasonable assumptions, these statements are not guarantees or predictions of future performance, and involve both known and unknown risks, uncertainties and other factors, many of which are beyond QR National’s control. As a result, actual results or developments may differ materially from those expressed in the statements contained in this Presentation. Investors are cautioned that statements contained in this Presentation are not guarantees or projections of future performance and actual results or developments may differ materially from those projected in forward looking statements. Past performance is not a reliable indication of future performance.

No liability

To the maximum extent permitted by law, neither QR National nor its related bodies corporate, directors, officers, employees, agents, contractors, advisers nor any other person, accepts, and each expressly disclaims, any liability, including without limitation any liability arising from fault or negligence, for any errors or misstatements in, or omissions from, this Presentation or any direct, indirect or consequential loss arising from the use of this Presentation or its contents or otherwise arising in connection with it.

AGENDA

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• Company update

Lance Hockridge, Managing Director and CEO

• Financial Overview Deborah O’Toole, Executive Vice President and CFO

• Medium to Long Term Outlook Lance Hockridge, Managing Director and CEO

• Questions and Answers

FY12 HALF YEAR PERFORMANCE

LANCE HOCKRIDGE – MD & CEO

HY12 CONTINUES DELIVERY AND MOMENTUM

 Revenue of $1.8bn – up 1% on HY11 QUALITY RESULT  Underlying EBIT of $251m – up 11% on HY11 IN A CHALLENGING  Coal volumes of 97.5mt – down 2% on HY11 ENVIRONMENT  Statutory NPAT of $189m versus $278m in HY11 due to $281m tax benefit  Interim dividend of 3.7c declared[(1)]

 Safety performance improvement - LTIFR of 2.64 compared with 4.72 in HY11 TRANSFORMATION  Revenue quality continues with Group Revenue/NTK of 55.4 – up 4% on HY11 MOMENTUM  Functional organisational structure implementation commenced 1st December 2011 CONTINUES  Transformation benefits driving improvement in operating ratio  Northern Missing Link project opened ahead of time  WIRP project agreement signed STRONG  ~9mtpa of new coal volumes contracted COMMITMENT  Hunter Valley growth – volumes up 34% on HY11 TO GROWTH  Iron ore on track to deliver ~30mtpa in 2014  CQCS Network capacity to increase to ~300mtpa by 2015

(1) the conduit foreign income component of the dividend is nil

FINANCIAL HIGHLIGHTS

	HY12	HY11	Variance
	$m	$m	%
Revenue	1,767	1,748	1%
Underlying EBITDA	468	446	5%
Statutory EBIT	260	131	98%
Underlying EBIT	251	226	11%
Statutory NPAT(1)	189	278	(32%)
Underlying NPAT	168	71	>100%
Statutory EPS (cps)	7.8	12.4	(37%)

(1) HY11 included $281m tax benefit

PERFORMANCE METRICS ROBUST ON REDUCED VOLUMES

QR National Group Operating metrics	HY12	HY11				Coal Tonnages Comparison	Coal Tonnages Comparison	Coal Tonnages Comparison	Coal Tonnages Comparison	Coal Tonnages Comparison	Coal Tonnages Comparison	Coal Tonnages Comparison	Coal Tonnages Comparison	Coal Tonnages Comparison
Revenue / NTK (A$/000 NTK)	55.4	53.5					H1							H2			FY11
Labour Costs / Revenue	31.7%	32.3%															HY12
NTK/employee (MNTK) Opex(1)/ NTK (A$/000 NTK) EBITDA Margin Operating Ratio(2)	7.0 47.5 26% 86%	6.9 46.6 26% 87%	Indicative tonnages
ROIC(3)	4.6%	4.5%
NTK (bn)	31.9	32.6
Tonnes (m)	130.4	132.3		Jul		Aug	Oct Sept	Nov	Dec		Jan	Feb	Mar	Apr	May	Jun
People	9,051	9,502		(1)		Opex defined		as operating expense					including depreciation and
						amortisation

• (2) Operating ratio defined as (1 - EBIT margin)

• (3) ROIC – calculated using 12-month trailing EBIT and comparative number represents year ended 30 June 2011

HY12 DELIVERING AGAINST STRATEGY

Strategy

Execution

Transformation

• Safety

• Commercial outcomes

• Customer service

• Performance improvement

• Cost reductions

• Asset utilisation

• Company-wide cultural change

• Attract, develop and retain the right people

• Up-skill workforce

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Transformation

• Safety performance continues to improve with LTIFR down 44%

• 35% of coal volumes on performance based contracts at 31st Dec 2011

• Coal Revenue/NTK +9% on HY11

• WIRP negotiated at commercial returns

• GAP tonnages commenced 19 December 2011

• Reliability Centred Maintenance Program has delivered improved availability and reliability

• Network’s Advanced Capital Upgrade Program has led to reduction in delays and faults, thus improving reliability and customer service delivery

• New functional structure implementation commenced 1st December 2011

Growth

• Contract wins

• Revenue growth

• Diversification

• Invest in infrastructure and above-rail assets

• Balance sheet and funding requirements

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Growth

• ~9mtpa of new coal contracts at commercial returns

• NSW Hunter Valley performance remains strong with 34% uplift in volumes on HY11

• Iron ore volumes on track to deliver ~30mtpa by FY14

• Projects under construction will increase CQCS capacity to ~300mtpa by 2015

• Queensland Government declared the Central Queensland Integrated Rail Project (CQIRP) a “significant project”

• Installed above rail capacity in place to meet increased demand following volume recovery

SAFETY – LEAD INDICATOR FOR PERFORMANCE

Lost Time Injury Frequency Rate (LTIFR)

Medically Treated Injury Frequency Rate (MTIFR)

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----- Start of picture text -----

20 50
45
17.5
40
15
35
12.5
30
10 25
20
7.5
15 41%
5
10
44%
2.5
5
0 0
MTI’s/Million Hours Worked
LTI’s/Million Hours Worked
Jun-08 Sep-08 Dec-08 Mar-09 Jun-09 Sep-09 Dec-09 Mar-10 Jun-10 Sep-10 Dec-10 Mar-11 Jun-11 Sep-11 Dec-11 Jun-08 Sep-08 Dec-08 Mar-09 Jun-09 Sep-09 Dec-09 Mar-10 Jun-10 Sep-10 Dec-10 Mar-11 Jun-11 Sep-11 Dec-11
----- End of picture text -----

• Improvements in safety demonstrate our operating discipline

• LTIFR 2.64

• MTIFR 13.21

• Signals Passed At Danger (SPAD) rate decreased 26% to 1.51 since HY11

• ZERO Harm – the culture that accepts that all injuries are preventable

• Focus on prevention through strong leadership and proactive risk management

FOCUS ON PRODUCTIVITY AND SERVICE IMPROVEMENT

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----- Start of picture text -----

10.2 hrs
10.1 CQCN Payloads (Tonnes ‘000s) 40 Average Total Turnaround Time (Hours)
10.0
38
9.9
36
9.8
Goonyella Blackwater 34 Blackwater/Moura
9.7
32
9.6
30
8.1
28
8.0
26
7.9
24
7.8
22
7.7
7.6 20
Goonyella
7.5 18
Jan-10 Apr-10 Jul-10 Oct-10 Jan-11 Apr-11 Jul-11 Oct-11 Dec-11 Jan-11 Mar-11 May-11 Jul-11 Sep-11 Nov-11 Dec-11
%
90 Goonyella On Time Departures (%)
QR National - Coal Revenue per NTK ($)
85
43
CAGR +15% 80
41
75
37
70
31 65
60
27
55
50
45
40
35
30
25
20
15
FY08 FY09 FY10 FY11 31-Dec-11 Jan-11 Mar-11 May-11 Jul-11 Sep-11 Nov-11 Dec-11
----- End of picture text -----

NEW FUNCTIONAL STRUCTURE UNDERPINS COMPANY-WIDE FOCUS ON CUSTOMER SERVICE

• Functional organisational structure aligns with global best practice

• Implementation commenced 1st December 2011

• The new structure will be a critical enabler in delivering customer service excellence

• Aligns operational focus and customer service

• Cost efficiencies and productivity gains expected through greater integration and collaboration

• Productivity gains will contribute to revenue quality improvements

• Management structure to accelerate the momentum of reform in the Company

NETWORK INVESTMENT FOR GROWTH

NORTHERN LINK OPENS UP MAJOR GROWTH CORRIDOR

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• Northern Link (69kms of new rail) completed ahead of time

• The GAP Project will deliver:

• a major upgrade and expansion of existing Newlands Coal System

• supports the 33mtpa increase in capacity on the Newlands system bringing total system capacity to 50mtpa

• potential expansions to 200mtpa and more

First coal train to cross the Northern Link on 19 December 2011

WIGGINS ISLAND RAIL PROJECT AGREEMENT SIGNED

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• A significant rail infrastructure investment servicing a new export terminal at Gladstone

Early works in advance of construction commenced February 2012, with first railings scheduled mid-2014

Additional 27mtpa of capacity created, representing a 30% increase in haulage in the southern Bowen Basin coal region



 Aligns with time frames for the proposed coal export terminal and the development of new mines

• Negotiated at commercial terms

DIVERSIFICATION THROUGH IRON ORE

Iron Ore Growth Profile



Tracking to our target of ~30mtpa by 2014

• Iron Ore customers include:

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----- Start of picture text -----

 Iron Ore customers include:
mt
30 – Karara Mining Ltd: up to 10.8mtpa [(1)] for ten
years – commenced 15 Jan 2012
25
–
Cliffs: volume increase from 8.5mtpa to
11mtpa – commencing March 2012
20
– Mt Gibson Iron:
–
15 3mtpa from Tallering Peak –
operational since 2004 through to
2014
10
–
3mtpa from Extension Hill –
5 commenced December 2011
–
Mineral Resources: up to 4mtpa –
0 commenced October 2011
FY11 FY12e FY13e FY14e
Mineral Resources Karara
Mt Gibson Iron Cliffs Natural Resources
----- End of picture text -----

(1) Magnetite shipments of 8.8mtpa and 2.0mtpa for DSO

FY12 FINANCIAL PERFORMANCE

DEBORAH O’TOOLE - EVP & CFO

FINANCIAL PERFORMANCE SUMMARY

• HY12 underlying EBIT of $251m up 11% on HY11

EBIT IMPROVEMENT ON HY11

 Network Services underlying EBIT of $156m down 8% due to lower network volumes  Coal underlying EBIT of $139m up 38% on HY11 despite lower volume  Freight underlying EBIT of $29m up 97% on HY11 with higher revenues and continued cost and efficiency improvements

BALANCE SHEET REMAINS STRONG

 Low gearing of 11% provides capacity to fund future growth  Committed debt facility capacity in excess of $2bn  Investment grade credit ratings of BBB+ (S&P) and Baa1 (Moody’s) maintained

CASH FLOW PERFORMANCE

 Underlying net operating cash flow of $457m in the first half  Cash conversion remains strong  Nil cash tax payable in HY12

QUALITY RESULT IN A CHALLENGING ENVIRONMENT

Financial	Financial
Revenue ($m) 1,767 +1%
Underlying EBITDA ($m) 468 +5%
Underlying EBIT ($m) 251 +11%
Statutory EBIT ($m) 260 +98%
Underlying NPAT ($m) 168 >100%
Statutory NPAT(1) ($m) 189 (32%)
Statutory EPS (cps) 7.8 (37%)
Underlying EBIT by Division
Network Services ($m) 156 (8%)
Coal ($m) 139 +38%
Freight ($m) 29 +97%
Other ($m) (73) (24%)
Group ($m)	251 +11%

Key Metrics	Key Metrics
Volumes	130.4	(1%)
Revenue / NTK (A$/000 NTK)	55.4	+4%
Labour Costs / Revenue	31.7%	+0.6%
NTK/employee(2) (MNTK)	7.0	+1%
Opex(3) / NTK (A$/000 NTK)	47.5	(2%)
Operating Ratio(4)	86%	+1%
ROIC(5)	4.6%	+0.1%
People	9,051	(5%)
Strong balance sheet
Total Assets ($m)	9,433	+3%
Net Debt ($m)	919	+34%
Shareholders equity ($m)	7,095	+1%
Gearing(6)	11%	+3%

(1) HY11 NPAT includes $281m tax benefit

(2) NTK/Employee using headcount as at 31 December as denominator

(3) Opex defined as operating expense including depreciation & amortisation

(4) Operating Ratio defined as (1 - EBIT margin)

(5) ROIC – calculated using 12-month trailing EBIT

(6) Gearing = Net debt /(Net Debt + total equity)

IMPROVEMENT vs. HY11

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300
HY12 EBIT Movement
12 20 6
8 18
250 11
200 45 47
150
251
226
100
50
0
Other
Qld Coal Volumes growth
Qld Coal NSW Coal Corporate efficiencies costs
Underlying HY11 revenue quality Freight volumes Improved fleet management Transformation Underlying HY12
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• The impact of lower QLD coal volumes has been offset through improvements to coal revenue quality via contract renewals, incentives and performance bonuses

• NSW tonnages increased by 34%

• The Reliability Centred Maintenance Program achieved maintenance and depreciation savings through improved fleet management

• Transformation costs reflect ongoing investment in the business to drive future efficiencies and costs associated with restructure

MAJOR COMMITTED CAPITAL PROJECTS

 Budgeted capital of $1.1bn GAP  Final commissioning of project on track for June 2012  First railings commenced 19 December 2011  Budgeted capital ~$900m WIRP stage 1  Early works in advance of construction commenced February 2012  First railings scheduled for mid 2014 and project completion by March 2015  Budgeted capital of $195m Blackwater  Largest electrical upgrade on the Central Queensland Coal System since 1980s Electrification  Project remains on schedule for commissioning in H2 of FY12 Hunter Valley  Budgeted capital of $362m Rollingstock  Rolling stock investment to support NSW growth  Budgeted capital of $291m WA Iron Ore  Locomotives, wagons and infrastructure for Cliffs and KML contracts tracking to plan Summary  HY12 capital spend of $609m

INVESTMENT OF OPERATING CASH FLOWS FUNDING FUTURE GROWTH

Underlying cash flow statement	HY12 $m
Operating activities
EBITDA	468
Other changes in working capital	22
Net Interest paid	(33)
Other non-cash items	0
Net cash inflow/(outflow) from operating activities	457
Payments made to acquire assets	(607)
Free cash (out) flow	(150)

Balance sheet	HY12 $m
Working capital	(27)
Property, plant and equipment	8,667
Net debt	(919)
Other	(626)
Net assets	7,095
Facilities	HY12 $m
$3bn Debt Facility Utilisation	975
Capitalised Establishment Fees	(23)
Cash	(33)
Net Debt	919
Gearing(1)	11%

NB: Based on underlying earnings

(1) Gearing = Net debt /(Net Debt + total equity)

BUSINESS OVERVIEW

NETWORK SERVICES

	HY12 HY11
Tonnages (million)	86.8 93.4
NTK (billion)	21.3 22.7
Revenue ($m)	595.4 642.4
Growth %	(7%) 21%
EBITDA ($m)	233.0 245.5
Margin %	39% 38%
EBIT ($m)	155.6 168.8
Margin %	26% 26%
Capital Expenditure ($m)	349.7 304.0

NB: Based on underlying earnings

Operating metric	HY12	HY11
Access Revenue / NTK (A$/000 NTK)	17.1	16.0
Maintenance $ /’000 NTK(1)	2.6	2.5
NTK / Track km (000’s)	9,138	10,049
Operating Ratio	74%	74%

Key Drivers

• Decline in network volumes from reduced coal railings

• Maintenance spend brought forward in advance of volume recovery

• Improved profitability in Services despite lower levels of wagon manufacturing and servicing

• (1) Track maintenance excludes ballast undercutting, derailments repairs, weather event repairs and electric traction maintenance

COAL

	HY12	HY11
Tonnages (million)	97.5	99.6
NTK (billion)	22.0	22.6
Revenue ($m)	949.9	895.7
Growth %	6%	3%
EBITDA ($m)	233.6	202.9
Margin %	25%	23%
EBIT ($m)	139.0	100.9
Margin %	15%	11%
Capital Expenditure ($m)	74.1	284.0

NB: Based on underlying earnings

Operating metric	HY12	HY11
Revenue / NTK (A$/000 NTK)	43.2	39.5
Opex(1) / NTK (A$/000 NTK)	36.9	35.1
Operating Ratio(2)	85%	89%

Key Drivers

• Reduced QLD tonnages due to slower than expected recovery from wet weather

• Above rail revenue continues to increase from new performance based contracts

• NSW Coal volume growth 34%

• Improved fleet management has generated savings in maintenance and facilitated a re-set of the useful life of locomotives

• (1) Opex defined as operating expense including depreciation and amortisation (2) Operating ratio defined as (1 - EBIT margin)

FREIGHT

	HY12	HY11
Tonnages (million)	32.9	32.7
NTK (billion)	9.9	10.0
Revenue ($m)	731.8	685.4
Growth %	7%	18%
EBITDA ($m)	62.0	43.2
Margin %	8%	6%
EBIT ($m)	28.5	14.5
Margin %	4%	2%
Capital Expenditure ($m)	166.9	90.0

NB: Based on underlying earnings

Operating metric	HY12	HY11
Revenue / NTK (A$/000 NTK)	73.8	68.5
Opex(1) / NTK (A$/000 NTK)	71.0	67.0
Operating Ratio(2)	96%	98%

Key Drivers

• Investment in capacity ahead of increases in future iron ore volumes

• Strong agricultural demand across Australia lifted Bulk results

• Intermodal contracts coming on line and business performance improvement continuing

• (1) Opex defined as operating expense including depreciation and amortisation (2) Operating ratio defined as (1 - EBIT margin)

FY12 GUIDANCE

• Coal volumes in HY12 impacted by production issues for our customers including the lingering impacts of the 2011 QLD floods as well as industrial relations issues

• Our current view is that we will deliver ~200mt – the low end of previous guidance provided. This is subject to normal seasonal rainfall and customers returning to preflood production levels

• FY12 EBIT guidance remains in accordance with the Offer Document with volume downside expected to be offset by delivering through the transformation program

• FY12 capital expenditure expected to be $1.1bn due to deferrals of uncommitted projects

MEDIUM TO LONG TERM OUTLOOK

LANCE HOCKRIDGE – MD & CEO

LEVERAGED TO GLOBAL GROWTH SECTORS

Thermal Coal

Global thermal coal imports Million Tonnes

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Global thermal coal imports Rest of World
Million Tonnes
China and India
1,200
CAGR +7%
1,000
800
600
400
200
0
2010 2011 2012 2013 2014 2015
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Crude Steel

Global crude steel production Million Tonnes

Rest of World China

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2,000 CAGR +5%
1,500
1,000
500
0
2010 2011 2012 2013 2014 2015
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Metallurgical Coal
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Australian Exports of Metallurgical Coal Million Tonnes

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200
CAGR +2%
150
100
50
0
2010 2011 2012 2013 2014 2015
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Iron Ore
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Australian Exports of Iron Ore Million Tonnes

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700
CAGR +9%
600
500
400
300
200
100
0
2010 2011 2012 2013 2014 2015
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SOURCE: Wood Mackenzie’s Coal Market Service – May 2011, Dec 2011 and Jan 2012, CRU Iron Ore Market Service – Jan 2012

PORT CAPACITY POTENTIAL ACROSS AUSTRALIA’S COAL SYSTEMS (MTPA)

Current Plate	Name Committed Investment Proposed Growth Proposed Name Plate Name	Name Committed Investment Proposed Growth Proposed Name Plate Name	Name Committed Investment Proposed Growth Proposed Name Plate Name	Name Committed Investment Proposed Growth Proposed Name Plate Name	Name Committed Investment Proposed Growth Proposed Name Plate Name	Name Committed Investment Proposed Growth Proposed Name Plate Name	Name Committed Investment Proposed Growth Proposed Name Plate Name	Name Committed Investment Proposed Growth Proposed Name Plate Name	Name Committed Investment Proposed Growth Proposed Name Plate Name	Name Committed Investment Proposed Growth Proposed Name Plate Name	Name Committed Investment Proposed Growth Proposed Name Plate Name	Name Committed Investment Proposed Growth Proposed Name Plate Name	Name Committed Investment Proposed Growth Proposed Name Plate Name	Name Committed Investment Proposed Growth Proposed Name Plate Name	Name Committed Investment Proposed Growth Proposed Name Plate Name	Name Committed Investment Proposed Growth Proposed Name Plate Name	Name Committed Investment Proposed Growth Proposed Name Plate Name	Name Committed Investment Proposed Growth Proposed Name Plate Name	Name Committed Investment Proposed Growth Proposed Name Plate Name	Name Committed Investment Proposed Growth Proposed Name Plate Name
Newlands/ NML/Galilee Goonyella Blackwater/ Moura West Moreton	Abbot Point		50							0			335						385
	Dudgeon Point Hay Point Dalrymple Bay	0 44 85								0			0	180					320
				44						1	1		0
									0					180
	RG Tanna Barney Point BICT (Alma) Wiggins Island Fitzroy	70 7 0 0 0							0										207
									0				-
									0						35
									2	7						53
																	22
	Brisbane	1				0				0			0						10
New South Wales	Port Kembla NCIG PWCS	1 30 133				133			1	2								120	0	349
										3	6		0
							0
								8		0
	Total																		1,271 738
								447			86

Source: BREE, Media releases, Port and government websites, Initial Advice Statements

PROSPECTIVE GROWTH PROJECTS

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Pilbara
Bowen
Galilee
Basin
Basin
Mid West
Surat
Basin
Yilgarn
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QUESTIONS

ADDITIONAL SLIDES

RECONCILIATION OF STATUTORY PROFIT & LOSS

		HY11			HY12
	Statutory	Underlying	Proforma	Statutory	Underlying	Proforma
Statutory EBIT	131.4	131.4	131.4	260.2	260.2	260.2
Transaction related costs	-	95.0	95.0	-	(8.8)	(8.8)
Timing related revenue:
- 2009 Revenue Cap	-	-	(16.5)	-	-	-
- 2011 Revenue Cap	-	-	21.0	-	-	-
- 2010 DTC	-	-	(5.1)	-	-	-
- 2011 DTC	-	-	-	-	-	(21.1)
Adjusted EBIT	131.4	226.4	225.8	260.2	251.4	230.3
Interest - net finance cost	(125.7)	(125.7)	(125.7)	(14.7)	(14.7)	(14.7)
Tax
- Income tax (benefit)/expense	271.8	271.8	271.8	(56.2)	(56.2)	(56.2)
- Underlying & proforma add back	-	(302.0)	(302.0)	-	(12.2)	(12.2)
Adjusted NPAT	277.5	70.5	69.9	189.3	168.3	147.2

RECONCILIATION OF STATUTORY PROFIT & LOSS

FY11 vs FY12 Half Year Profit & Loss

		HY11			HY12
$Am	Underlying result	Significant items	Actual	Underlying result	Significant items	Actual
Revenue	1,747.6	0.0	1,747.6	1,766.9	0.0	1,766.9
Consumables(1)	(745.9)	0.0	(745.9)	(720.8)	0.0	(720.8)
Employee benefits expense	(551.0)	(57.2)	(608.2)	(558.0)	0.0	(558.0)
Other expenses	(3.9)	(37.8)	(41.7)	(18.9)	8.8	(10.1)
Interest income (add back)	(1.2)	0.0	(1.2)	(1.5)	0.0	(1.5)
EBITDA	445.6	(95.0)	350.6	467.7	8.8	476.5
EBIT	226.4	(95.0)	131.4	251.4	8.8	260.2
Net finance cost	(125.7)	0.0	(125.7)	(14.7)	0.0	(14.7)
Tax expense	(30.2)	302.0	271.8	(68.4)	12.2	(56.2)
NPAT	70.5	207.0	277.5	168.3	21.0	189.3
EPS (cps)	3.1	9.3	12.4	6.9	0.9	7.8
EBIT breakdown by division:
QRN Network Services	168.8	(1.8)	167.0	155.6	0.0	155.6
QRN Coal	100.9	0.0	100.9	139.0	0.0	139.0
QRN Freight	14.5	0.0	14.5	28.5	0.0	28.5
Other	(57.8)	(93.2)	(151.0)	(71.7)	8.8	(62.9)

(1) Consumables expenditure includes fuel costs, access costs payable to third parties, and expenditure of general repairs and maintenance and administrative supplies

KEY PRIORITIES FOR DRIVING PERFORMANCE EXCELLENCE

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Safety
Revenue Quality
Cost, Efficiency & Productivity
Capital Efficiency
Growth
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GALILEE BASIN

• The proposed Central Queensland Integrated Rail Project granted a project of “State Significance” on 27 January 2012

Multi-user access, combining “brownfield” and “greenfield” solutions servicing the Central and South Galilee Basin

mines proposed with a combined capacity of more than 200mtpa of thermal coal

Source: CQIRP Initial Advice Statement 5 December 2011.

SURAT BASIN JOINT VENTURE

• The “Southern Missing Link” - a 214 kilometre railway that will enhance the existing coal rail network

• The open-access, multi-user rail link between Wandoan and Banana is key to strategic development, unlocking approximately 5.4bn tonnes of coal reserves

• Connecting to the Wiggins Island Coal Export Terminal

• JV comprising ATEC, Xstrata Surat and QR National

Source: http://suratbasinrail.com.au/